Apollo Tyres SA has announced plans to invest R300 million in new equipment and technology for the company's Ladysmith manufacturing plants over the next three years.

It is the local subsidiary of India-based Apollo Tyres Group, which bought Durban-headquartered Dunlop Tyres International in 2006 for R382m.

"This investment will make it possible for us to remain globally competitive and reduce production costs. The new investment will be 100 percent into our Ladysmith plant, but part of the machinery will be servicing both plants - in Ladysmith and Durban," said Luis Ceneviz, the chief executive officer.

"The technology and equipment we will be bringing on stream over the next three years will remove certain bottlenecks in our production processes. It will further enhance product quality and reduce waste - a critical focus area for Apollo Tyres as an environmentally responsible tyre manufacturer."

Ceneviz said the new investment announcement came on the back of recently completed upgrades to the Dunlop Durban and Ladysmith plants, totalling R250m over the past few years. Together with the new investment announced recently, it would bring to more than R500m that Apollo would pump into its South African operations in seven years.

The Durban Automotive Cluster (DAC) welcomed the investment into the KZN motor industry.

"It is a clear indication of improved business confidence level and a commitment to upgrade competitiveness in the regional automotive sector after the recession," said Thabani Shale, the general manager of DAC.

"As a cluster member firm, Apollo Tyres will also compete more favourably with international competitors as a result of this investment into its local facilities. This was highlighted by the recent DAC comparative study of the cost competitiveness of automotive production in Thailand relative to KwaZulu-Natal," he said.

Ceneviz said Apollo Tyres South Africa was planning to create more than 100 new jobs in line with the investments.

"We are also aggressively implementing a learnership strategy to upskill our South African workforce for the future... Apollo Tyres has a very aggressive future growth plan for its African and Latin American markets, and this investment will ensure that it has additional capacity available ahead of demand," he said.

"We have been engaging with Numsa and (the) government on our future plans and they are fully supportive of the investment. This is a demonstration of our commitment to remain in the country and of our continued belief in South Africa as an investment destination," Ceneviz said.

The Apollo Tyres Group acquired Dunlop Tyres in 2006 and during 2009 it added the premium ultra-high performance tyre manufacturer in the Netherlands, Vredestein Banden BV to the Apollo Tyres stable. These acquisitions are part of a global strategy to build Apollo Tyres into one of the top 10 tyre manufacturers in the world, with the goal of becoming a $2 billion company by this year.

Ceneviz said the South African operation was a key part of this growth with a current annual turnover of R2bn. The Durban and Ladysmith plants produce about 90 tons of tyre products a day each.

"Apollo Tyres SA is fortunate to be part of a global group that is aggressively growing in terms of market share and presence.

"We are continuously looking at new opportunities and are growing organically as well as inorganically," he said.

"The Apollo Tyres Group is aggressively pursuing organic and inorganic growth in different parts of the world with more emphasis on BRIC (Brazil, Russia, India and China) countries as well as low-manufacturing cost countries. Today the South African operation represents around 15 percent of the total company turnover," he said.

Brazilian-born Ceneviz was headhunted by Apollo Tyres to run its South African operations.

Ceneviz is naturally backing Brazil to win the Fifa World Cup in South Africa.

"I'd love to see Bafana Bafana disputing the final with Brazil. I'm fortunate to have the tickets to Brazil versus Portugal in Durban. This will be a great game," he said.

Suren Naidoo

The Mercury